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Dalton Strategic Partnership Announces Transition Agreement and Management Appointments

25 January 2012

Following the sad death of Andrew Dalton in April 2011, Dalton Strategic Partnership (“DSP”) is pleased to announce that agreement has been reached in principle for the purchase of equity in the firm by the executive partners of DSP from the Dalton Family.  

As a result of the transaction, senior executives of DSP will control 51.5% of the equity of the firm while the Dalton Family will continue to retain a quarter of the firm’s equity. The agreement, for which Heads of Terms have been signed, is due to complete in February 2012 and will ensure that the firm remains independent and incentivises the executives to continue to grow the business as a private company.  

DSP’s external shareholders and strategic partners, FuNNeX Asset Management,based in Tokyo, and Interward Asset Management, based in Toronto, will also retain their interest in DSP.  They remain supportive of the independent status of the business and are fully committed to the firm’s ongoing development.  

This announcement follows a period of strong performance for the firm which increased assets under management by 24% and revenues by 50% in 2011, leading to a significant increase in profits.  

The success of the Melchior Selected Trust European Absolute Return Fund has been a strong driver of the business in 2011. The fund, and its offshore equivalent, have delivered positive returns every year since 2006, and as a result, have attracted significant assets over the last two years. In October 2011, DSP added to its range of absolute return funds with the launch of the Melchior Selected Trust Indian Absolute Return Fund.  

DSP is also pleased to announce a new management team. Magnus Spence, who co-founded DSP with Andrew Dalton in 2002, has taken over as Managing Partner of the firm and leads a new management team comprising the following senior executives: 

Rupert Caldecott – Head of Wealth Management business

Leonard Charlton – Head of Absolute Return business

Nick Mottram – Head of Long-Only Equity business

Richard Jones – Head of Sales & Marketing

All of the members of the management team, together with other senior executives of the firm have invested capital in DSP and in the Melchior range of funds.  

Magnus Spence, Managing Partner at DSP, commented:

"Andrew was a much-loved and inspirational leader of the firm until his tragic death last year and we are committed to maintaining the independent partnership structure that he created. By investing capital in the business and in the Melchior range of funds, the interests of my partners and I are closely aligned with those of our clients who remain at the centre of everything that we do.  We are also aligned with our external shareholders and are incentivized to grow DSP as a successful and profitable business.  

“DSP is a well-balanced business with good growth opportunities in each of its three core business areas.  The Absolute Return business has been a key driver of growth over the last two years and provides consistent returns irrespective of the direction of equity markets. It is complemented by our Long-Only Equity business which comprises a range of institutional and retail equity funds which offer the prospect of significant growth opportunities when the appetite for equity risk returns.

Our Wealth Management business delivers a high quality personalised investment proposition to high net worth clients, trusts, charities and institutions. With a focus on achieving absolute returns by employing active asset allocation, our wealth management clients have enjoyed stable investment returns over the last 9 years.  Given these dynamic and complementary businesses, DSP is well placed to respond to the challenges of today’s investment environment.”

DSP was advised on the transaction by Fenchurch Advisory Partners.

 

Notes to Editors

Dalton Strategic Partnership (DSP) is a global investment management firm founded in 2002 by Andrew Dalton and a number of former colleagues from Mercury Asset Management/Merrill Lynch Investment Managers. Assets under management are USD 2.35 billion (as at 30th December 2011).   

The firm believes that investments should be managed in a global context, rather than within a narrow focus on one country or region. A global debate using macro-economic research and global investment horizons drive DSP’s active investment approach. DSP has a highly experienced team of global investment managers who provide top-down views. These views are supported by market-specific research from specialist regional equity teams.  With this background we believe that active investment management by talented stock pickers can consistently out-perform market indices.  

A disciplined approach to risk management incorporates a proper understanding of risk and a sensitive approach to its application to portfolios. Risk is controlled by using sophisticated risk modelling techniques and fundamental analysis of stocks, recognising any dangers within them, rather than measuring risk with reference to benchmark indices.

DSP has three core businesses – an absolute return business; a long only investment management business which manages a range of specialist long-only equity funds; and a Wealth Management business offering absolute returns to private clients, charities and family offices through active global asset allocation within fund structures and segregated accounts.

DSP is authorized and regulated by the Financial Services Authority. Dalton Capital (Hong Kong) Limited is authorized and regulated by the Securities and Futures Commission in Hong Kong. These are both owned by Dalton Capital (Guernsey) Limited which is regulated by the Guernsey Financial Services Commission.

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